Dainippon Sumitomo Plunges by Record After Halting Drug Trial

May 26 (Bloomberg) -- Dainippon Sumitomo Pharma Co. plunged
by a record in Tokyo trading as it suspended a study on an
experimental drug for colorectal cancer and at least two
brokerages cut their ratings on the stock.

Dainippon Sumitomo stopped the study after an independent
safety monitoring committee said the drug for advanced
colorectal cancer, called BBI608, failed to meet the criteria
set for managing the disease, it said in a May 23 statement
after Tokyo markets closed. There was no safety concern,
according to the company.

The Japanese company is examining the financial impact from
the suspension of the trial and will make a disclosure promptly
if necessary, it said. The study was in the last stage of
patient studies generally required for a regulatory review and
compared the efficacy of the medicine against a placebo. The
drug is being tested for other types of cancer and the company
will proceed with development, it said.

Yasuhiro Nakazawa, a health-care analyst at SMBC Nikko, cut
the stock to neutral from outperform, saying the timing of the
study’s suspension was a negative surprise. Nomura Securities
Co. cut its rating to neutral from buy.